HARDWOOD RECORD 



17 



This condition has been called psychological. The same kind of 

 l>sychology is involved as that which would cause a prudent man 

 to hesitate before venturing .upon thin ice. He would rather come 

 to a stop on the shore than take a chance of going through the ice. 

 It is the same psychology that produces hesitation in a traveler who 

 suspects that a footpad is lying in wait for him by a lonely road. 

 It is a prudent hesitation, though the fear may not actually be well 

 founded; yet, so long as there is fear, the traveler will be leery 

 about venturing. A similar psychological situation exists when a 

 banker declines to make a loan to a man who has little property of 

 his own, and whose other security is of doubtful value. The man 

 who is refused the loan may insist that the condition is entirely 

 psychological ; but that will fail to persuade the conservative banker 

 that he ought to make the loan. Expectation of reward and fear 

 of loss are weighed in the balance, and fear often outweighs hope. 



The ol(l proverb, "Nothing risked, nothing gained," might be 

 modified to read, "Too much risked, nothing gained." The Amer- 

 ican business man is not a coward ; neither is he unduly timid. He is 

 willing to take reasonable chances. He does not shy at a shadow. 

 At the same time he insists on seeing the road a few steps ahead 

 before he sets out to travel it. That holds particularly tnie after he 

 has heard a good many threats of hostility, and has became sus- 

 picious of a number of circumstancos which have conu' to liis knowl- 

 edge. 



The Cost of Manufacture and Lumber Prices 



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are a constant sul. 



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IN THESE DAYS whe 

 discussion it would seem that a great deal of unnecessary and 

 harmful price cutting could be avoided if the lumbermen as a 

 general thing were better equipped to tell exactly what their 

 product is costing. The man who will deliberately sell goods at a 

 figure which on the face of the transaction shows a direct loss 

 is an exception, but the man who will sell at what he considers 

 a small profit under the stress of adverse conditions is not at 

 all exceptional. Thus it can easily be seen that any misinforma- 

 tion which would seem to place figures on the cost of manufac- 

 ture at a point lower than they actually are cannot fail to act 

 detrimentally to the general market. 



It can readily be appreciated that when a concern is actually 

 paying between $9 and $9.50 for all charges in lumber manufac- 

 Iwre, including sales, from the time the logs are unloaded at the 

 mill to the time the lumber is actually disposed of and money 

 returned, but figures that cost at only $4.50, the chances for 

 price cutting are much greater than when the cost is actually 

 known. 



Yet this condition applies exactly to a great many sawmill 

 operations. The hardwood manufacturers who know their actual 

 manufacturing cost are today rare. Exception will probably be 

 taken to this statement, but it is nevertheless a fact. No other 

 conclusion is possible when one concern in a certain territory after 

 very careful study and computation knows its cost is $9.15 while 

 another concern operating within a few miles and under the same 

 conditions claims that it is turning out its lumber and selling it 

 at from $4.00 to $4.50 from the log delivered at the mill. 



Aside from the fact that it is poor business not to know costs 

 more closely than this, the possible detrimental effects on the 

 lumber business in general are of tremendous scope. It can 

 readily be appreciated that fluctuating lumber values are to a great 

 extent the result of confused knowledge of manufacturing and sales 

 costs. 



It is a generally known fact that no other business in this country 

 is operated along such lines. It certainly seems that under present 

 conditions when in certain cases it is necessary to convert stock into 

 cash, but at the same time to make some kind of a profit from such 

 transactions, an accurate knowledge of the cost of operating is an 

 absolute essential to the prevention of bankruptcy. That the lum- 

 ber business is successfully carried on with these methods in vogue 

 is nothing short of a miracle, but if livmber manufacturers would 

 apply themselves to the task of ascertaining the absolute cost of 

 production the lumber business would be a much more staple propo- 

 sition and the fluctuations in lumber values would be practically 



eliminated. Lumber would then be sold for what it is worth rather 

 than for what it will bring because manufacturers would simply 

 refuse to dispose of stock when they knew they were losing money. 

 As it is their attitude is somewhat like that of the ostrich who hides 

 liis head under the sand when he scents danger. The lumberman 

 who disposes of his stock not knowing what it costs, simply taking 

 a chance on making a profit, has about the same chance of escaping 

 impending danger as has the ostrich who shuts his eyes and waits. 



An Appeal and the Answer 



THE RAILROADS HAVE APPEALED to the Interstate Com- 

 merce Couunission for help. They wish to advance rates in order 

 to raise money to meet running' expenses and make improvements; 

 but that phase of the question can be overlooked for the present, and 

 whether rates are raised or not, lumbermen have it in their power 

 to help the carriers and at the same time benefit themselves. It will 

 not cost the lumbermen anything to do it. 



In shipping lumber the cars can be loaded with 60,000 pounds in 

 place of 45,000. The lumber will be carried at the same rate, and 

 three cars will take as much as four with the smaller load. The rail- 

 road will have one less car to haul, and that car will be available to 

 carr}- some one else's freight to market. In times of car shortage 

 the available supply would be increased one-fourth if all shippers, 

 woulil load to capacity instead of only seventy-five per cent of ca- 

 pacity. Business generally would be stimulated by an increase in 

 transportation facilities, and the beneficial results would be widely 

 felt. 



The shipper will gain in time required for his product to reach 

 market if it goes forward in full cars instead of those only partly 

 loaded; because delays are due to the number of cars to be handled 

 rather than to the weight of the cars. One less in four will effect no 

 small saving in time required to reach destination. The Chicago 

 Lumbermen 's Association is carrying on an extensive campaign along 

 these lines. It is a subject worth exploitation by all associations. 



Wood for Fuel 



THOSE WHO MAXU'ULATE STATISTICS to show the drains 

 on the forests frequently lose sight of the largest item, fuel.. 

 The cut of limiber is tabulated from year to year; the crosstie pur- 

 chases are counted; the pulpwood, tanbark, cooperage stock and 

 veneer cut are added to arrive at the total; but the fuel is over- 

 looked. Y'et, according to figures compiled by the Forest Service, 

 fuel is the leading item which must be supplied by the forests of 

 this country. 



The total is said to reach 100,000,000 cords annually.' If thia 

 is reduced to board measure on the basis of 600 feet to the cord, it 

 amounts to 60,000,000,000 feet, or fifty per cent more than the yearly- 

 cut of lumber. It is impossible to obtain an actual count of the 

 cords of wood cut. It is too much scattered for that. An exhaustive 

 series of estimates were procured from all parts of the United 

 States, from men engaged in the cordwood business. The estimates 

 stated the cords per capita used in vOJages, towns and counties per 

 year, and the estimates being local in most instances, they were 

 based on actual knowledge. From thousands of such local estimates, 

 from Maine to California, a general average for the whole coimtry 

 was deduced, and was found to exceed one cord for each individual, 

 or approximately 100,000,000 cords a year-. 



It was a surprise to find that the highest per capita use of wood 

 as fuel in the United States is in Tennessee. Wood is cheap and 

 plentiful there; and in the rural districts the open fireplace, which 

 consumes enormous quantities of fuel, is yet common, and it partly 

 accounts for the high ratio in that state. 



Cordwood cut for fuel comes largely from waste, such as slabs 

 from sawmills, tree tops left on the ground in lumber operations, and 

 scrub growth and inferior trees which are not in demand for any- 

 thing else. The fuel cutter does not often take what the sawmilj 

 man wants. If the fuel demand were doubled it could be met with- 

 out taking much good timber. Transportation would be the chief- 

 problem, because the largest markets are not in proximity to the 

 principal supply. Coal has not wholly displaced wood as fuel, even 

 in regions where the mineral fuel is abundant and wood is relatively 



